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What if I can't afford my car loan?
My girlfriend and I have been long-distance for almost two years now, and I want to move in with her. There aren’t many jobs in my industry in that area, and I’ll likely have to accept a lower salary than I have now. What can I do if I can't pay my car loan anymore?
Jack Walsh · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
That sounds like a big move, and I’m sure your girlfriend will greatly appreciate you taking that step!
If you can’t afford your
car loan
, you need to contact the lender ASAP. Contacting them before you miss a payment shows you’re acting in good faith. Just explain the situation, and they’ll likely work with you to come up with a solution.More often than not, the lender will allow you to modify the loan or defer payment. This can save your credit score from being negatively affected.
If your lender refuses to modify the loan or the new payment amount is still unaffordable, you should consider:
- Refinancingthe loan into an agreement that better meets your financial needs
- Selling or trading in the vehicle for one you can more easily afford
- Surrendering the vehicle and ending the loan entirely
Once you move, don’t forget to inform your
car insurance
company. Note that if you’re moving to a new state, you may have different minimum insurance requirements
, as well.If you want to ensure you have the required coverage and aren’t overpaying for it, use
Jerry
, an insurance comparison app that shops for low prices with over 50 insurance companies for free.Once you make a selection, Jerry takes care of the rest—securing your new policy and helping you cancel your old one. The average Jerry user saves $879 a year.
View full answer
- Gregory R.
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